January 6, 2021

Matt Mullenweg: Collaboration Is Key (#100) | The Knowledge Project with Shane Parrish

Check out the The Knowledge Project Podcast Page & Episode Notes

Key Takeaways

• “Open-source is a hack that gets competitors to work together” Matt Mullenweg 
  • Humans outcompeted all other animals because they could collaborate
  • That’s why in the long run, open-source software will win every market that’s in
• With open-source software, you get the opposite of the tragedy of the commons
  • Each person working in his self-interest makes the thing better
• Working together in person gets people closer, in a way that you can’t replicate online
  • Knowing that this is an issue you have to actively invest to improve relationships with co-workers
  • Automattic’s “Secret Sauce” is to get people to get together in-person 3-4 times annually
• “Make reversible decisions quickly and irreversible ones deliberately” Tony Schneider (early business partner)
  • If it’s a reversible one you’ll learn a lot more by doing it, rather than debating it for weeks
• Matt never wanted Automattic to take over the market for WordPress paid services
  • You have to capture enough, but always less than the value you create for others
• “It’s very difficult to drive World-changing performance if it’s just for a paycheck, or just for your personal benefit, you need to be connected to something larger” Matt Mullenweg

Key Products Mentioned

• Nonviolent Communication by Marshall B. Rosenberg was game-changing to Matt’s communication style
• The best framework Matt found on improving performance is from Dan Pink’s book, Drive: The Surprising Truth About What Motivates Us
• Farnam Street’s Great Mental Models books were sponsored by Automattic
• Books that influenced Matt’s thinking on mental models
  • Thinking Fast and Slow by Daniel Kahneman
  • Principles by Ray Dalio

Intro

• Matt Mullenweg (@photomatt) is the co-founder of WordPress, the open platform that runs most websites, and the CEO of Automattic
  • Check out Matt’s website
• Host: Shane Parrish (@ShaneAParrish)
• In this chat, Matt discusses his philosophy about open-source software, company organization, collective decision-making, and much more

WordPress’ Success

• At the start, WordPress’ competitors were better positioned to take over the internet
  • They were better funded, had more talent, etc…
• Matt ascribes WordPress’ success to
  • Creating a community
    • People loved working on it
  • Adaptability
    • WordPress could be customized for every use
  • Strong company philosophy
    • Open-source
    • To Matt, the open-source philosophy is the most important idea that he has been exposed to

Open-source Philosophy

• “Open-source is like software with a bill of rights attached” Matt Mullenweg
  • The bill of rights ensures certain freedoms
• Open-source Software has four freedoms attached
  • Freedom to use the software for any purpose
  • Freedom to see how the software works (look under the hood)
  • Freedom to modify the software
  • Freedom to distribute those changes
    • This makes open-source software win in the long run
    • Different versions will be available and the best ones will survive
• What makes people want to work on open-source projects?
  • Part of the other freedoms involved is the freedom to sell it or commercialize it
    • You could take WordPress and sell it
    • Companies like Bluehost and GoDaddy do this
• There are different business models that can be used with open-source software
  • If you put your best features into a paid software, the open-source, free one is likely to die
  • WordPress’ approach is to put its best features in a core, free offering
    • Then they create paid services around it (example of Akismet)
• “Open-source is a hack that gets competitors to work together” Matt Mullenweg 
  • Humans outcompeted all other animals because they were able to collaborate
  • That’s why in the long run, open-source software will win every market that’s in
• With open-source software, you get the opposite of the tragedy of the commons
  • Each person working in his self-interest makes the thing better

Automattic’s Philosophy to Capture Value

• Automattic is a for-profit company created to build on and flourish from the open web
  • Matt’s idea was to pair his non-profit (WordPress.org) with a for-profit company in a way that strengthened both companies
  • Automattic creates paid services for WordPress.org
    • WooCommerce
    • WordPress.com
• Matt never wanted Automattic to take over the market for WordPress paid services
• He wanted to maintain a thriving ecosystem of strong companies creating services for WordPress
  • If you’re capturing more value than you create, you’ll inevitably die
  • If you’re not capturing enough value you’ll inevitably die
  • You have to capture enough, but always less than the value you create for others
• Matt was inspired in this idea by Microsoft, which stated that for every dollar they make, $20 are made by the Microsoft ecosystem
  • He saw that all successful ecosystems had this ratio of $1 made for every $20 created
    • He considers Facebook as a “fake platform”, as Facebook makes 90% of the revenues in its ecosystem

Environment, Performance

• Your environment is the most important thing affecting how you work
  • The smells, music, light, everything contributes to your mental state while you work
• WordPress pays a lot of attention to the environment it creates
• The best framework Matt found on improving performance is from Dan Pink’s book, Drive: The Surprising Truth About What Motivates Us
  • Mastery: Getting good at what you do by being challenged
  • Autonomy: Freedom to be able to do what you think is right
  • Purpose: Working for something bigger than yourself
    • “It’s very difficult to drive World-changing performance if it’s just for a paycheck, or just for your personal benefit, you need to be connected to something larger” Matt Mullenweg

Words Create Reality: Remote vs Distributed

• Matt is aware of the strong power of the words we use in our reality
  • The way you name initially is really important
  • Changing names after that is really difficult
• Automattic is a remote company, but Matt doesn’t call it “remote”, he calls it “distributed”
  • Remote implies that you are far from the center
    • A “remote town” is isolated, far away
• Matt’s idea is to create an antifragile, fully distributed organization
  • Each node in the network has equal weight to others
  • The system becomes more resilient because each node is relatively independent but contributes to the whole
• Automattic’s philosophy for its distributed team is to leave lots of freedom to its employees
• Other benefits of distributed teams
  • It’s easier to slack off in an office than it is remotely
    • In offices there’s a lot more signaling, you can hide behind constant meetings, etc.
  • Offices are also very distracting
    • Humans are social animals and in-person they get caught up in social games that distract them from work

The Levels of Autonomous Organizations

• The levels of how companies evolve to become fully distributed
• Level 0: Jobs that absolutely can’t be done remotely (construction workers)
  • We are finding that many jobs that we thought to be Level 0 are not (telemedicine)
• Level 1: You can get by not working in the office for emergencies
  • The company is not designed to allow distributed work
• Level 2: You try to re-create everything you did in the office online
  • Most companies went to this level during the pandemic
    • Usually exhausting for employees
    • Too many online meetings
• Level 3: When you start to embrace the benefits of being online
  • Example of using a common Google Doc to take notes during a meeting
    • Helps to make sure that everyone is on the same page
• Level 4: Move from synchronous to asynchronous
  • People can work together without having to work at the same time
  • This unlocks major benefits
    • Access to global talent 
    • Give people far more flexibility
    • Better decision making (people have more time to think)
    • Empower introverted employees, who are less capable to bring their best ideas in meetings
• Level 5: The somewhat unattainable goal to aspire to
  • When the distributed organization outperforms in-person organizations under every aspect (productivity, happiness, etc…)

Downsides to Distributed, Investing in Relationships

• Matt really enjoys spending time with his colleagues
  • He wishes he could do that more
• Working together in person gets people closer, in a way that you can’t replicate online
  • Knowing that this is an issue you have to actively invest to improve relationships with coworkers
    • When people invest in improving their relationship, the effects multiply on the company and product
  • Automattic’s “Secret Sauce” is to get people to get together in-person 3-4 times annually
• Overworking is also often a problem in distributed teams
  • Automattic used to not track vacation time, but people weren’t taking enough
  • Now they started tracking it again to encourage employees to take more

Mental Models and Decision Making

• “Make reversible decisions quickly and irreversible ones deliberately” Tony Schneider (early business partner)
  • If it’s a reversible one you’ll learn a lot more by doing it, rather than debating it for weeks
    • Speed of iteration in software is essential
  • You could argue that every decision is reversible, but some of them require really high costs to be reversed
  • Those are the decisions you should be more deliberate about
    • Who you choose to partner with, acquisitions, important hires
  • Some amount of editing will inevitably improve your writing
    • Similarly, important decisions can be improved by approaching them more deliberately
• In organizations, everyone should be able to challenge other’s ideas
  • You should be able to argue against your idea even better than the person challenging it
  • Matt likes Farnam Street’s article on this: The Work Required to Have an Opinion
• Books that influenced Matt Mullenweg’s thinking on mental models
  • Thinking Fast and Slow by Daniel Kahneman
  • Dan Ariely’s books on Behavioral Economics
  • Principles by Ray Dalio
• Matt avoids being too prescriptive
  • He hopes he can find better ways to do things with time
  • He thinks Shane should interview people at different points in time to see how their ideas changed

Distributed Decision Making

• Instead of making decisions in a meeting, at Automattic they create written threads for people to share their ideas and thoughts
  • These threads become like a decision journal, allowing to identify flaws in their thinking and processes
  • This can sometimes spiral out of control, but overall it works well for them
• Automattic took direct steps to optimize this process
  • They hire people who can write clearly and succinctly
    • Clear writing represents clear thinking
  • If a thread is too long, someone will summarize it to help everyone catch up
    • Matt thinks a lot about time efficiency
• Automattic has 80% fewer meetings than most companies
  • This makes it very easy to arrange an important meeting when there is an emergency

Automattic’s Org Structure

• Automattic today has 13,000 employees
• Matt designed the organizational structure to be fractal
  • As you zoom in or out, the structure looks similar
  • As teams grow, they split into two and starts coordinating
• The hardest growth phase was going from 20 to 50
  • In this phase, you lose the ability to “force” collaboration
  • You need to have a good process to onboard new people effectively
  • The company experienced a lot of internal issues among employees
• Early on Matt was influenced by Basecamp’s philosophy to keep the company small
  • He used to think that larger organizations would necessarily be worse
    • That caused people to be overworked for some time
  • Today he sees that as a limiting belief
    • Why can’t the company get better if you bring in more great people?

What Matt Learned Working with a Coach

• He found subtle, but powerful ways to improve his communication
  • Instead of asking “Is there anything I can do to help you”?
  • He now asks “What do you need for this to be a success?”
  • The first question implicitly gives power to Matt, the second empowers the other
• He started listening more to his body, with awareness
  • In the past, he used to try to only rationalize and solve problems intellectually
    • We’re often taught to suppress negative emotions, but this makes them come back
  • Identifying and allowing negative feelings allows them to go away instead of affecting you
    • This affects the relationships you have and your decision-making
  • Feeling emotions also allows access to some “unverbalizable” wisdom in the body

Additional Notes

• Matt divides his time into three buckets
  • Taking care of people
  • Taking care of the product
  • Extra time to deal with emergencies that arise

Knowledge Project : decision making, open source, remote work
Notes By Giorgio Parlato